Latest in Hendrickson's criminal trial

[Gregg]

Okay, forgive me one more then. It looks like Pete is trying to contest the law, not the facts, can he do this? What I mean it, it is my understanding that a jury can decide yes or no he received the money, yes or no he said he didn't, but the "money in question is gross income and we ain't gonna discuss that", that's a question for the judge to decide on a motion etc...

Am I right in thinking that even though they'll it go at the start, as soon as they start presenting this garbage to the jury, the Judge is gonna cut that off?

[Lambkin]

I can only imagine the conversations between Pete and his attorneys that resulted in that document being handed in with a wink. They couldn't change his mind but they hope the judge will make him see reason. A fruitless hope, but if their client is in funds then perhaps it doesn't matter so much.

[.]

That's code so the judge understands that this is done at Hendrickson's insistence

The disclaimer was obvious. If PH insists on rubbish, were I the lawyer I'd tell him to find a new one. That judges allow this sort of ridiculous dance to go on without sanctions (in the interest of paperwork avoidance) is just as repugnant as a lawyer soaking a moron to advance BS "arguments."

It's the sort of thing that lends (mistaken) credence to claims of "corruption."

[Dezcad]

The initial Motion to Dismiss Indictment filed on January 15, 2009 is scheduled for hearing next week.

The government's reply is here and PH's response to the government's reply is here..

03/16/2009 26 AMENDED NOTICE of hearing on 18 MOTION to Dismiss Indictment as to *Peter Hendrickson*. Motion Hearing set for 5/14/2009 03:00 PM before District Judge Gerald E Rosen (LSau) (Entered: 03/16/2009)

The docket does not indicate whether the most recent "Motion to Dismiss Indictment" will be heard at that same time.

[ASITStands]

Please note the phrase "It is the defendant's position" in the two relevant (i.e., frivolous) places - that he is not a "person", and that he is not an "employee" who receives "wages". That's code so the judge understands that this is done at Hendrickson's insistence, and they do not share in this legal "position". Technically, should the lawyers have placed horseshit over their signatures? No, of course not. But every lawyer who has substantial criminal experience has done it, and judges understand and - as I wrote above - would rather write a one-paragraph "Denied. So ordered." than conduct a hearing on ineffective assistance. I don't know this judge, but in front of almost every judge I do know this would not result in even the mentioning of sanctions.

That "almost" is better discussed over a beer.

I agree that it's how defense attorneys and judges handle cases like these. There's some latitude in allowing the attorney to present the defendant's theories and defenses.

A denial changes everything, as it becomes obvious the court will not hear such nonsense.

[ASITStands]

Okay, forgive me one more then. It looks like Pete is trying to contest the law, not the facts, can he do this? What I mean it, it is my understanding that a jury can decide yes or no he received the money, yes or no he said he didn't, but the "money in question is gross income and we ain't gonna discuss that", that's a question for the judge to decide on a motion etc...

Am I right in thinking that even though they'll it go at the start, as soon as they start presenting this garbage to the jury, the Judge is gonna cut that off?

Generally, that's correct. However, when you have a witness who might have some credibility on the stand (in the sense he can speak for himself), you get an opportunity to present testimony and evidence showing the defendant really believes in his theory.

Think Tommy Cryer!

However, as we've discussed, Hendrickson has destroyed whatever "good faith" defense he might have had though various means. Witnesses also get cross-examined.

Juries have at times considered the law and facts of a case, but it's rare. Somewhere in the plethora of stuff Hendrickson has written, there's information on jury nullification. I'd think there'd be some plan (by Hendrickson and followers) to get the jury to consider law.

Also, consider whether anyone like JJB would be a witness for the prosecution.

[Judge Roy Bean]

The court accepts the defendant's assertion that he is not a person. It follows therefor, that he must be an animal. But what kind? The court concludes that he is an infectious stray and orders that he be taken to the pound and gassed.

[Dr. Caligari]

Earlier in the thread, someone asked if Rule 11 applies to criminal proceedings. Answer: yes, it does, but it's rarely invoked.

Rule 11 of the Federal Rules of Civil Procedure authorizes sanctions for frivolous complaints or motions. Rule 11 of the Federal Rules of Criminal Procedure covers an entirely different topic (entering & changing pleas). I am not aware of any provision in the Criminal Rules which authorizes sanctions (though I suppose there is an inherent power in any court to sanction attorney misconduct, as some prosecutors in D.C. are about to discover). In all the years I did federal criminal defense, I never heard of a motion for sanctions against a defense attorney.

[LPC]

It looks like Pete is trying to contest the law, not the facts, can he do this? What I mean it, it is my understanding that a jury can decide yes or no he received the money, yes or no he said he didn't, but the "money in question is gross income and we ain't gonna discuss that", that's a question for the judge to decide on a motion etc...

Not exactly.

Whether PH received income making the returns "false" is a question of fact that the government must prove beyond a reasonable doubt. If PH disputes whether what he received was income, the judge will instruct the jury on the relevant law and let the jury apply the law to the evidence presented.

Whether PH understood that he received income making the returns "willfully" false is also a question of fact that the government must prove beyond a reasonable doubt. And the judge will instruct the jury on the issue of willfulness.

But the judge can't say to the jury that the money that Hendrickson received is income, and the return he filed was false, because no matter how clear those issues might seem to me and you, they are still questions of applying the law to the facts and so belong to the jury.

There was a similar issue in the Simkanin case, and here is the relevant part of the opinion from the 5th Circuit:

At trial, Simkanin testified that one reason behind his decision not to withhold taxes from Arrow's employees was his belief that the IRC, which is over 7,000 pages long, contains an extensive (and exclusive) list of industries and activities. Simkanin stated that because Arrow did not operate in any of the listed industries or perform any of the listed activities, he concluded that Arrow's workers were not employees under the IRC and that he therefore was not required by law to withhold taxes. He further stated that he believed that the definition of an "employee" under the IRC was limited only to persons who worked for a governmental entity including the state or a political subdivision thereof.

During its deliberations, the jury sent a note to the district judge asking the following question:

Since no proof has been made that the defendant and his employees are in an occupation listed in those 7,000 [pages], are we to conclude that they are, in fact, not in that 7,000, or do we need to read all 7,000 to see what the defendant was referring to, and in fact, wasn't listed in the 7,000[?]

The court responded to the jury's question by stating:

Now, in answer to your note: You are instructed that you do not need to concern yourself with whether defendant's employees are in an occupation "listed in those 7,000." The Court has made a legal determination that within the meaning of Title 26, United States Code, Section 7202, during the years 1997, 1998, 1999, 2000, 2001, and 2002, [Arrow], through its responsible officials, had a legal duty to collect, by withholding from the wages of its employees, the employees' share of the social security taxes, Medicare taxes, and federal income taxes, and to account for those taxes and pay the withheld amounts to the United States of America. You are to follow that legal instruction without being concerned whether there are certain employers who are not required to collect and withhold taxes from the wages of their employees.

Of course, you will bear in mind in your deliberations all other instructions the Court has given you concerning the law applicable to this case.

Defense counsel objected to the court's response on the ground that, inter alia, the response "amount[ed] to an instructed verdict of guilty by instructing [the jury] on that point since that is the disputed issue and the basis for his defense."

The trial transcript, as well as Simkanin's initial brief, make perfectly clear that the disputed issue at trial was whether Simkanin willfully violated the federal tax laws. The basis for his defense was that he did not willfully fail to collect and pay over taxes in violation of § 7202 (and that he did not knowingly present false claims for refund) because he believed in good faith that he was not required by law to withhold such taxes.

Simkanin argues on appeal that the district court's response to the jury note constituted a directed verdict on an essential element of the offense, and therefore reversible error, for two reasons. First, Simkanin argues that the court's response erroneously instructed the jury to disregard Simkanin's good-faith defense. Second, he asserts that the court directed a verdict for the prosecution on the first element of the § 7202 offense—that Arrow was an employer that paid wages to its employees. He contends that the district court's error in this regard warrants the vacatur of his conviction as to Counts 3-12 (willful failure to withhold) and Counts 13-27 (false claims of refund for taxes withheld).

As we stated United States v. Cantu, 185 F.3d 298, 305-06 (5th Cir.1999):

The district court enjoys wide latitude in deciding how to respond to questions from a jury .... Overall, we seek to determine whether the court's answer was reasonably responsive to the jury's questions and whether the original and supplemental instructions as a whole allowed the jury to understand the issue presented to it.

(internal citation and quotation marks omitted). "It is well established that the instruction may not be judged in artificial isolation, but must be considered in the context of the instructions as a whole and the trial record." Estelle v. McGuire, 502 U.S. 62, 72, 112 S.Ct. 475, 116 L.Ed.2d 385 (1991) (internal quotation marks omitted).

In arguing that the district court's response directed the jury to disregard his good-faith defense, Simkanin relies on United States v. Burton, 737 F.2d 439 (5th Cir.1984), a case involving a defendant's failure to file income tax returns. In Burton, the district court instructed the jury that "[t]he court has ruled as a matter of law that a good faith belief that wages are not income is not a defense to the charges in this case." 737 F.2d at 440. We reversed, holding that a defendant's good-faith belief that the tax laws did not require him to file returns (as opposed to a belief that the tax laws are invalid or unconstitutional) would have negated the willful element of the charged offense and therefore constituted a valid defense. Id. at 441-42. Burton is easily distinguishable, however, because unlike the district court in Burton, the district court in the present case did not explicitly instruct the jury to disregard the defendant's beliefs about the applicability of the tax laws. Rather, the court instructed the jury that the defendant's purported view of the law—that the fact that the IRC did not list his business activities alleviated him from a legal duty to withhold taxes—was incorrect. Thus, the district court acted properly under the circumstances. See Barnett, 945 F.2d at 1300. We see nothing in the district court's instruction that would have led the jury to believe that it must disregard Simkanin's good-faith defense on the willfulness element, especially because the court specifically instructed the jury to keep in mind the other instructions, which included its instruction on willfulness.8 Thus, the jury remained free to decide the contested issue in the trial, i.e., whether Simkanin's violations of the tax laws were willful as that term was properly defined in the jury instructions.

Second, in a clever reconstruction of the district court's response to the jury note, Simkanin argues that the court's response constituted a directed verdict on another element of the offense, which was uncontested at trial—namely, the requirement that Arrow was an employer that paid wages to its employees. Counsel contends that, after the court informed the jury of its legal determination that Arrow had a legal duty to withhold, the jury logically could no longer find that Arrow was not an employer that paid wages to its employees—for if the jury found that Arrow was not an employer that paid wages to its employees, then it would mean that Arrow, in effect, did not have a legal duty to withhold taxes. This reading of the court's response, while plausible in a literal sense, is entirely divorced from a reading of the instructions as a whole, as well as from the context in which the jury asked its question and the court responded.

Simkanin relies heavily on this court's decision in Bass, 784 F.2d at 1282. In Bass, the defendant was charged with willfully submitting false or fraudulent income tax withholding exemption statements to employers in violation of 26 U.S.C. § 7205. 784 F.2d at 1283. The defendant asserted as one of his defenses that he could not be held criminally liable under § 7205 because he was not an "employee" for the purpose of supplying withholding information on a W-4 to his employer. Despite this defense, the district court in Bass instructed the jury that "as a matter of law the defendant ... was an employee of" the company in question. Id. at 1284. We found this instruction to be constitutionally erroneous because, "by instructing the jury that Bass was an employee, the district court relieved the prosecution of its duty of proving, beyond a reasonable doubt, Bass's guilt of every element of the offense charged." Id. at 1284-85.

Unlike in Bass, however, the district court in the present case did not explicitly direct a verdict on an essential element of the offense. At most, the court's response, when viewed in isolation, could be interpreted as implicitly requiring the jury to find that Arrow was an employer that paid wages to its employees, lest the jury's finding on that element logically conflict with the district court's instruction. However, the district court also expressly instructed the jury at least twice that, in order to convict Simkanin under § 7202, it must determine beyond a reasonable doubt that Arrow was an employer that paid wages to its employees. Furthermore, when the court answered the jury's question, it reminded the jury to consider all the other instructions that had been given. Thus, when viewed in the context of the entire jury charge, the district court's response merely instructed the jury that Simkanin's belief that he was not required to withhold taxes because Arrow's activities were not listed in the 7,000 pages of the IRC was an incorrect view of the law, and that, if the jury found that Arrow was an employer that paid wages to its employees, Simkanin had a legal duty to withhold despite his professed belief to the contrary. Hence, the district court's answer was reasonably responsive to the jury's question and was a correct statement of the law—it instructed the jury that whether or not Arrow's business activity appears on a list in the IRC is irrelevant to whether Simkanin had a legal duty to withhold. See Cantu, 185 F.3d at 305-06. The original and supplemental instructions as a whole allowed the jury to understand the issue presented to it and required the jury to decide whether the government had proven each essential element beyond a reasonable doubt. See id. Accordingly, we conclude that, when the district court's response is viewed in the context of the instructions in their entirety, there was not a reasonable likelihood that the jury applied the instruction as if it were a directed verdict on that element of the offense. See United States v. Phipps, 319 F.3d 177, 189-90 (5th Cir.2003) ("The question is ... whether this single misstatement makes the instruction defective as a whole.... [T]he proper inquiry is not whether the instruction could have been applied in an unconstitutional manner, but whether there is a reasonable likelihood that the jury did so apply it." (internal citation and quotation marks omitted)); United States v. Musgrave, 483 F.2d 327, 335 (5th Cir.1973). Accordingly, we find no error in the district court's response to the jury note.

Moreover, even if we were to conclude that the district court's response to the jury note was erroneous, which we do not, we still would not reverse on this ground. In this case, both parties agree that we should affirm if the government proves that the alleged error was harmless beyond a reasonable doubt. See Neder v. United States, 527 U.S. 1, 119 S.Ct. 1827, 144 L.Ed.2d 35 (1999); Chapman v. California, 386 U.S. 18, 23, 87 S.Ct. 824, 17 L.Ed.2d 705 (1967). Therefore, we would proceed under that assumption, and we would conclude that the government has met its burden to establish that any error here was harmless. In Bass, 784 F.2d at 1285, we stated that we could not deem the court's explicit directed verdict on the "employee" element harmless "ecause one of Bass's defenses was that he was not an `employee[]'...." Here, however, one of Simkanin's defenses was not that Arrow was not an employer that paid wages to its employees under the IRC (although one of his defenses was that he did not willfully violate the law because he erroneously believed that Arrow was not an employer that paid wages to its employees under the IRC). During the course of the trial, defense counsel introduced no evidence that Arrow was not an employer that paid wages to its employees, and defense counsel did not argue or otherwise suggest during the trial that the prosecution had not established this element beyond a reasonable doubt. On appeal, Simkanin does not point to any evidence introduced supporting the notion (or any conceivable basis upon which a rational juror could conclude) that Arrow was not an employer that paid wages to its employees under a legally accurate interpretation of the relevant sections of the IRC. Rather, Simkanin falls back on the argument that it is possible that the jury could have decided that the government's evidence, although uncontradicted, did not establish that element beyond a reasonable doubt. However, we believe that it would have been irrational for the jury to do so, and Simkanin's argument does not suffice to raise a reasonable doubt in our minds that the jury might have concluded that Arrow was not an employer that paid wages to its employees. This is an instance in which the relevant element was "supported by uncontroverted evidence" and in which the "defendant did not, and apparently could not, bring forth facts contesting the omitted element." Neder, 527 U.S. at 18-19, 119 S.Ct. 1827. Accordingly, applying the harmless-error standard agreed upon by the parties, we would find any error here to be harmless beyond a reasonable doubt.

(Footnotes omitted]

So the verdict was not reversed, but it shows that a judge telling the jury that the "money in question is gross income and we ain't gonna discuss that" could be very dangerous.

Incidentally, I see that Simkanin will be released in July. I guess the pressure from his supporters is finally paying off.

[wserra]

Rule 11 of the Federal Rules of Civil Procedure authorizes sanctions for frivolous complaints or motions.

Right. I understood the question to mean were sanctions possible in criminal proceedings, not whether there was a specific rule.

I suppose there is an inherent power in any court to sanction attorney misconduct

I don't think there is any question of that. Dealing specifically with counsel adopting pro se frivolity:

As an initial matter, the Court notes that Panton is currently represented by counsel, [redacted - a friend of mine and good guy]. Although Mr. [redacted] has seemingly adopted the pro se motion of his client, see Letter to Assistant United States Attorney Lev Dassin from [redacted] of 4/21/94, the Court notes that the “trend” among defense counsel of adopting “frivolous pro se motions” has recently come under harsh censure. People v. Rivera, 159 Misc.2d 556, 605 N.Y.S.2d 822, 824-25 (Bronx Sup.Ct.1993) (remarking upon “the proliferation of frivolous motions by defendants represented by competent assigned counsel” and warning that sanctions can result from the “thoughtless” adoption of a client's pro se motion that proves to be meritless). Although the Court may not merely disregard Panton's pro se motion, the Court is neither satisfied that the motion was appropriately “adopted” by counsel, nor pleased that counsel has chosen to proceed in this manner.

United States v. Panton, 1994 WL 225441 (SDNY).

Still, I think it unlikely to happen here. The worst will be similar rumbles of judicial discontent.

[Judge Roy Bean]

At the risk of wandering too far afield here, I'm not sure about the Rules of Professional Conduct in their state, but 'round here:

III. 3.01 Meritorious Claims and Contentions. A lawyer shall not bring or defend a proceeding, or assert or controvert an issue therein, unless the lawyer reasonably believes that there is a basis for doing so that is not frivolous.

I'd love to see the rationale for a "reasonable belief" that Hendrickson's arguments as they have adopted are not frivolous.

[Dezcad]

PH's puppets have filed their 3rd Motion to Dismiss the Indictment today.

This Motion and accompanying brief focuses solely on the argument that PH is not a "person" and the "includes" argument.

1. The Indictment fails to charge Peter Hendrickson as a “person” within the meaning of 26 USC 7206(1).
2. Even if the Indictment did allege that Mr. Hendrickson is a “person” within the meaning
of the above statute, both the language of the statute and case law decided under it
exclude Mr. Henderson from the class of “persons” subject to the duty imposed by that
statute.

The brief even mentions the Internal Revenue Code of 1939 and the Revenue Act of 1942.

[Gregg]

At the risk of wandering too far afield here, I'm not sure about the Rules of Professional Conduct in their state, but 'round here:

III. 3.01 Meritorious Claims and Contentions. A lawyer shall not bring or defend a proceeding, or assert or controvert an issue therein, unless the lawyer reasonably believes that there is a basis for doing so that is not frivolous.

I'd love to see the rationale for a "reasonable belief" that Hendrickson's arguments as they have adopted are not frivolous.

You know, I'm in favor of having it heard, just to keepthem from saying it's never been decided (and they'll add not by they SCOTUS)

[wserra]

Wow. While I would still bet against sanctions, these idiots are doing their best to prove me wrong.

[Demosthenes]

In the sixth Circuit, United States v. Maggi, 83 A.F.T.R.2d (RIA) 877

On appeal, Maggi raises four issues for review:
.
snip
.

4. Was I duly convicted under 26 U.S.C. Sec. 7201 when Congress made it ONLY applicable to the "person" defined in 26 U.S.C. Sec. 7343 and I have offered unrebutted proofs that I am not such person; and, if I were such person, I would have to be charged with acts of fraud against the U.S. Government before additional punishment under Sec. 7201 could be lawfully applied?

.
snip
.
The term 'person' as used in the tax code has been consistently, and plainly, defined as any individual.

[Demosthenes]

in the 9th circuit, United States v. Studley, 783 F.2d 934

Studley contends that she is not a "taxpayer" because she is an absolute, freeborn and natural individual. This argument is frivolous. An individual is a "person" under the Internal Revenue Code and thus subject to 26 U.S.C. § 7203. United States v. Romero, 640 F.2d 1014, 1016 (9th Cir. 1981). 3


FOOTNOTES

3 We note that this argument has been consistently and thoroughly rejected by every branch of the government for decades. Indeed advancement of such utterly meritless arguments is now the basis for serious sanctions imposed on civil litigants who raise them

.

[Demosthenes]

More from the 9th, United States v. Romero, 640 F.2d 1014

the reference to the word "person" in section 7203 of title 26 is intended to encompass not only all individuals subject to income tax liabilities, but also legal entities liable for tax payments or required by law and regulations to make a tax return. The trial judge properly instructed the jury on the meaning of these terms. Romero's proclaimed belief that he was not a "person" and that the wages he earned as a carpenter were not "income" is fatuous as well as obviously incorrect. See Lucas v. Earl, 281 U.S. 111, 114-15, 50 S. Ct. 241, 74 L. Ed. 731 (1930); Roberts v. Commissioner, 176 F.2d 221, 225 (9th Cir. 1949); 26 U.S.C. § 61 (1976). The trial judge acted properly with respect to his comments and instructions regarding this matter of law. See United States v. Miller, 634 F.2d 1134 (8th Cir. 1980).

[Dezcad]

Wow. While I would still bet against sanctions, these idiots are doing their best to prove me wrong.

PH's puppets are setting the bar so low that even Stilley and Springer can't fit under it.

[Demosthenes]

In the 6th, United States v. Boling, 837 F.2d 477

Boling's third and final argument is patently frivolous. He contends that the trial court lacked "subject matter jurisdiction in persona" because he is not a "person" as defined in 26 U.S.C. § 7343. Nothing in section 7343 limits the ordinary meaning. of "person" so as to exclude individuals such as Boling.

[Demosthenes]

In the 7th, United States v. Latham, 754 F.2d 747

The other jury instructions proffered by the defendant are equally inane. Thus we hold that the district court did not err in refusing the other instruction offered by Latham implying that 26 U.S.C. § 7343 defining "person" does not include natural persons. 2 Similarly, Latham's instruction [**7] which indicated that under 26 U.S.C. § 3401(c) the category of "employee" does not include privately employed wage earners is a preposterous reading of the statute. It is obvious that HN5within the context of both statutes the word "includes" is a term of enlargement not of limitation, and the reference to certain entities or categories is not intended to exclude all others.


FOOTNOTES

2 "The statute's provision was not intended to exclude [individuals] or to limit the ordinary meaning of the term 'person' so as to exclude individuals or 'natural persons' . . . from their responsibility to comply with the tax laws." United States v. Rice, 659 F.2d 524, 528 (5th Cir. 1981).